I had a conversation earlier this week with a sales leader at a well-known PLG company and it got me thinking about a couple of things that I wanted to explore further.
- A lot of PLG companies underestimate the amount of change management required when implementing their first sales team and a Product-Led Sales motion.
- Executing on a PLS strategy is much harder when you don't have a shared language and set of definitions to lean on.
Change management and PLS
One of the biggest areas of underinvestment I've seen is on the upfront work of getting buy-in and alignment on the PLS GTM across an entire organization. I'm not saying companies are forgetting to get alignment, it's more about how that alignment should be reinforced.
Why do you need alignment?
As we've discussed before, Product-Led Sales is a team sport. Unlike traditional GTM models where each function can work largely autonomously on their own priorities and track their own metrics, for PLS to work effectively every team from product and sales to marketing and customer success needs to be aligned on a unified set of goals.
In Product-Led Sales, even more so than PLG, you need to consider what is best for the customer's journey. As we've learned, not all problems can be solved through your self-serve channels. Sometimes your buyers want a human touch. Your product, customer, and marketing teams need to be aligned on where the hand offs occur in the customer journey, but also be nimble enough to pivot if necessary, because again, you need to do what is best for the customer and their experience.
Ways to make sure you have alignment
Getting alignment once and constantly reinforcing the change are two different things. To get started, in a previous post I outlined a strategy 1-pager that can help you get that initial alignment. But, in order to truly make the change, here are some ways you can reinforce alignment:
- Shared definitions
- Shared metrics and goals across teams
- Cross-functional weekly or monthly meetings
- Creating a "council" or "squad" for critical points of alignment like PQLs and pricing & packaging
This brings me back to point #2 - shared definitions.
My goal here is not to lay out a definitive guide here but a living document we can update as Product-Led Sales matures. I hope we - as a PLS community - can develop and iterate on these definitions together.
#1 Product-Led Growth
The definition of Product-Led Growth is probably most misunderstood by the largest group of people (just scroll through PLG Twitter 😉). If you speak to 10 people you will likely get 10 slightly different definitions for PLG.
Some of the biggest misconceptions about PLG are...
- PLG is simply a freemium or free trial version of your product
- PLG precludes you from having a sales-led motion
What we've uncovered from talking to hundreds of PLG companies and from our recent PLS benchmark survey - PLG and sales very much exist together (97% of companies surveyed either had PLG and sales or had plans to add a sales team).
As a starting point, I'm borrowing the best definition I could find. Since they coined the term it's no surprise that OpenView has a well thought out definition for PLG. I chose this because it goes beyond characterizing PLG as just another word for freemium and delves into some of the other aspects of PLG as a growth model.
OpenView's definition? Product-led growth (PLG) is an end user-focused growth model that relies on the product itself as the primary driver of customer acquisition, conversion, and expansion.
#2 Product-Led Sales
Now, this is one we obviously have had a hand in defining, but I must admit we could probably do a better job with our definition of PLS. Some mistakenly believe PLS to mean a PLG company that has a sales team. This is somewhat correct but missing a key nuance. PLS is an entirely new sales motion, so it is not just about adding a sales team, you must also redefine who sales engages and how they engage.
Our definition? PLS is a bottom-up go-to-market model that leverages existing product users as the main funnel for the sales team.
Where can we improve? Does PLS apply to companies who don’t have a PLG model initially, but want to leverage product data about existing users in the sales cycle? Or perhaps a company wants to power expansions by understanding their existing users and their product usage? Are these also PLS strategies? PLS applies beyond the sales teams, so our definition needs to speak to marketing, customer success, and the entire GTM team.
#3 Product-Qualified Leads
Hopefully, this definition is starting to standardize across organizations...we've talked about it a LOT and for good reason. PQLs are a perfect unifying metric for your PLS motion. I think it's possible for us to have unified definition of the components of a PQL but the specific PQL definitions and how they are operationalized within an organization will vary wildly from team to team.
Our definition? A Product-Qualified Lead (PQL) is a user or account that has shown strong product usage, fits your ideal customer profile (ICP), and/or has indicated buying intent. You will have multiple PQL scores based on how you choose to segment your go-to-market - this can be by your goals, customer segments, or sales-readiness.
Where can we improve? We need to say goodbye to this idea that a PQL is one single score. Unless you are just beginning to define PQLs or your product and GTM are very simple, it's unlikely you will be able to capture all of the nuance of your GTM into a single PQL score.
The talk of 2022 is the sales-assist role. As more companies build out their PLS motion, we're seeing a lot of job postings about this new role. Similar to PQLs, I think it's possible to align on a baseline definition for this role and the main charter, but the specific way it manifests within an organization will differ across organizations.
Our definition? Put quite simply, the sales-assist role is exactly what it sounds like…help/assist a user in their journey, whether the user is ready to purchase more or they hit a point of friction, and everything in between. The sales-assist team offers a human touchpoint for users who are potentially good sales opportunities but need help solving their problem, getting value out of the product, or making a purchase decision.
Where can we improve? The similarities and differences between sales-assist and the customer success role. We’ve seen some organizations re-train customer success folks for pre-sales to fit the role of sales-assist. We also see many different titles for sales-assist such as product specialist, onboarding specialist, etc. What are the similarities and differences between these roles and customer success? Where do the hand-offs happen?
According to our recent benchmark report, almost every PLG company has a sales team or is planning to add one soon. Why? Most PLG companies eventually try to go "upmarket" where a human touchpoint in the sales process is necessary. But what exactly does moving upmarket mean?
Our definition? There is no singular definition for upmarket in our opinion. Moving upmarket in most cases means targeting larger organizations or "the enterprise" and expanding your product to include features required to satisfy these larger customers. Defining "upmarket" or "enterprise" will depend on your companies goals and ICP. Both Zendesk and IBM are "enterprise" because they have more than 1000 customers, but in most other respects these two accounts could not be more different.
Where can we improve? Being clear about our upmarket ICP before heading down this path. Not having a clear definition of what upmarket means could lead to a sales team that is not laser focused on the right opportunities and a potentially confusing product roadmap.
Expanding the dictionary
What other definitions do you think we should add to this list?
Any other jargon that makes your head spin?
Product-Led Sales terminology will be an ongoing exercise in search of the perfect definition, but don't worry we'll keep you up to date with the latest as PLS matures over the coming year.
To join the conversation and contribute your own definitions, request an invite to the #1 community for all things Product-Led Sales.